Former Bank of England governor Mervyn King has said the fall in the value of the pound since the EU referendum is a ‘welcome change’ for the UK economy.
The value of the pound has fallen to its lowest level against the dollar since 1985 as traders bet against the currency following the vote to leave the EU. At one point last week the value of the pound fell by as much as 10% during early trading in Asia.
However, King (pictured) told Sky News that the slide in the value of the pound would be good for the UK.
‘The economy was slowing somewhat before the vote and we are in a position where the rest of the world is not offering us much help,’ he said.
‘So from that point of view the fall in sterling is a welcome change.’
He added: ‘The whole thing has generated reactions which are over the top.
‘During the referendum campaign, someone said the real danger of Brexit is you’ll end up with higher interest rates, lower house prices and a lower exchange rate, and I thought: dream on.
‘Because that’s what we’ve been trying to achieve for the past three years and now we have a chance of getting it.’
King has previously said people should not panic about market volatility following the vote to leave the EU.
Source: City Wire